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World shipping industry goes out of business

Jun 04 2016

Guide: In the current global economic downturn, ocean shipping containers are also experiencing the worst depression in shipping from china
In the current weak global economy, Ocean Shipping Containers is also experiencing the worst depression in history. In January, there was tracking showing that no freighter was traveling in the waters between the North Atlantic and Europe and North America. This was the first time air navigation in history. Hundreds of cargo ships were anchored at sea or anchored in the port. .

The latest report of Drury Shipping Consulting, which has been counting the global container index since 2011, states that the container rate index of 11 trade routes between Asia, Europe and the United States fell by 62% in 2015. It can be seen that international trade is Facing a catastrophic moment.

"At present, there is an excess of container services on Chinese and European routes. This phenomenon has led to the use of small freighters in the Atlantic (6.740, 0.07, 1.05%), while the utilization rates in North America and Europe have also been squeezed." According to Andrew Abbott, CEO of Canadian Atlantic Containers Limited.

Due to weak demand, excess capacity, fierce competition in freight rates, container freight rates have plummeted. What the shipping companies can do now is to discard the freighter. According to statistics, 85 freighters have been abandoned last year, and analyst Herman Hildan believes that this year may reach 340. You know, many companies buy ships with loans. The average price of each ship is $ 65 million, and the sale is barely $ 35 million. The cost of leasing a freighter has also dropped to historical lows. In addition to the costs of labor and maintenance, a ship loses $ 14,000 a day. There is no other way for shipping companies to abandon or leave idle.

Nowadays, the biggest concern of shipping companies is the slowdown of the Chinese economy, but they are also afraid that under the low interest rate policy, some powerful shipping companies will use the low interest rate policy to buy more new ships, which may exacerbate the excess situation of the shipping industry. In addition, once the demand for coal, iron ore and consumer goods heats up, competition in the shipping industry will become more intense.

Lundry said that the container rate between Shanghai and Rotterdam and Genoa has reached a new low, and the cost of container shipping in Los Angeles is slightly higher. In order to maintain operations, some shipping giants have begun to save costs by cutting expenses, reducing or canceling routes, cutting staff, and postponing investment plans. Analysts said that the slump in the shipping industry has benefited overseas traders, with the average price of a 40-foot container being $ 701.

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